Insiders At EEKA Fashion Holdings Sold CN¥237m In Stock, Alluding To Potential Weakness

Over the past year, many EEKA Fashion Holdings Limited (HKG:3709) insiders sold a significant stake in the company which may have piqued investors' interest. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, if numerous insiders are selling, shareholders should investigate more.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

See our latest analysis for EEKA Fashion Holdings

EEKA Fashion Holdings Insider Transactions Over The Last Year

The Chairman & CEO, Ming Jin, made the biggest insider sale in the last 12 months. That single transaction was for HK$236m worth of shares at a price of HK$10.72 each. That means that an insider was selling shares at slightly below the current price (HK$15.00). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. It is worth noting that this sale was only 8.2% of Ming Jin's holding.

In the last year EEKA Fashion Holdings insiders didn't buy any company stock. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).

Insider Ownership

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that EEKA Fashion Holdings insiders own 66% of the company, worth about HK$6.7b. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About EEKA Fashion Holdings Insiders?

The fact that there have been no EEKA Fashion Holdings insider transactions recently certainly doesn't bother us. While we feel good about high insider ownership of EEKA Fashion Holdings, we can't say the same about the selling of shares. Therefore, you should definitely take a look at this FREE report showing analyst forecasts for EEKA Fashion Holdings.

Of course EEKA Fashion Holdings may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions of direct interests only, but not derivative transactions or indirect interests.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.